December 23, 2022

President Biden Enacts Castro-Authored Legislation to Protect Fair Pay for Military and Foreign Service Spouses

WASHINGTON – Today, President Joseph R. Biden enacted the Civil Service Federal Employee Serving Overseas Pay Equity Act, legislation authored by Congressman Joaquin Castro (TX-20) to ensure that military and foreign service spouses receive fair pay when teleworking for the federal government from overseas. The legislation is included in the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023, which passed the U.S. House of Representatives on December 8, 2022, and the U.S. Senate on December 15, 2022.

“America’s military and foreign service families make extraordinary sacrifices for their country and Congress should do everything within our power to lessen their burden,” said Congressman Castro. “Every year, we lose too many of our best and brightest public servants because of the financial strains of overseas assignments. With the enactment of the Civil Service Federal Employee Serving Overseas Pay Equity Act, military and foreign service spouses will no longer be financially penalized for serving their country from abroad.”

Domestic federal civil service employees currently earn a base salary with a locality pay adjustment based on the cost of living of the location they are serving in. The adjustment begins at 16.2% for civil servants living in the lowest cost-of-living areas in the United States and can reach up to 42.74% for those living in the most expensive areas of the country. However, under current law, civil servants working abroad under the Domestic Employee Teleworking Overseas (DETO) arrangements (often military or foreign service spouses who receive permission to telework abroad when their spouse is stationed overseas) cannot receive locality pay, regardless of the cost of living in their telework location. Under the current DETO system, an entry-level human resources assistant making $36,488 in San Antonio, Texas would see their salary fall to $31,083 if they followed their spouse on an overseas assignment.

The strength of the DETO program also has a significant impact on the ability of the civil and foreign service to retain mid-career workers, who are often tenured employees with institutional knowledge. The sizable pay cuts faced by civil servants who move abroad can push them to leave federal service for the private sector or leave the workforce altogether, especially if they have children or dependents at home who need full or part-time care. 

The Civil Service Federal Employee Serving Overseas Pay Equity Act would require members of the civil service under a DETO agreement to be paid the lower of either what they would have been paid in the United States or what a member of the Foreign Service at an equivalent level serving overseas is paid. 

The full text of the legislation can be found in section 9717 of the National Defense Authorization Act here.